Lead Opinion
This is an action under section 30-108 (2), R. R. S. 1943. It involves an election on behalf of an incompetent surviving spouse to either take under or against her husband’s will. The District Court vacated an order of the county court electing on behalf of the widow to take the provision made for her in her husband’s will. The executor prosecutes this appeal. We affirm.
Joseph D. Clarkson, deceased, married Evelyn Bell Clarkson April 16, 1953. Mr. Clarkson had two daughters
The will makes the following provision for the incompetent: “If my wife, Evelyn Bell Clarkson, survives me, I give, devise and bequeath to the FIRST NATIONAL BANK OF OMAHA, as TRUSTEE for my said wife, an аmount equal to one-fourth (%) of the value of my net estate as finally determined for Federal Estate Tax purposes, unreduced by any taxes.” The will directs the trustee to pay all income therefrom to Mrs. Clarkson and in addition provides for such amounts of principal to be paid to her from time to time as the trustee deems necessary or desirable to provide for her proper support and maintenance. The will further provides that upon Mrs. Clarkson’s death the trust estate shall terminate and the assets remaining in the trust shall then be distributed and disposed of to such persons in such manner as Mrs. Clarkson by her last will and testament shall direct and appoint. If Mrs. Clarkson fails to exercise the general testamentary power of appointment upon her death, the will provides that the remaining assets shall be distributed as follows: “Twenty-five Thousand Dollars ($25,000) thereof shall be paid to each of my wife’s children, JERRY W. MENCK and PEGGY LOU Me VEA, with the children of either of them who may be then deceased to take equally the share which the parent would have taken if then living; and the balance of said assets remaining shall be dis
Pursuant to the provisions of section 30-108 (2), R. R. S. 1943, the Douglas county court appointed Jack W. Marer as guardian ad litem to make such investigation as he deemed necessary and to report his recommendation to the court as to whether the court should elect on behalf of Mrs. Clarkson to take the provisions made for her under the last will and testament of Joseph D. Clarkson or to take by descent and distribution as provided by law. The guardian ad litem, after investigation, filed a report recommending that the court renounce the provision made for Evelyn Clarkson under the last will and testаment of Joseph D. Clarkson and elect to take by descent and distribution as provided by law. The county judge declined to accept the recommendation. He determined her interests were not better served by renouncing the will but that the equities of the matter dictated that the testamentary plan of Joseph D. Clark-son should be adhered to.
The special guardian of the incоmpetent prosecuted an appeal to the District Court for Douglas County. The District Judge disagreed with the opinion of the county judge and followed the recommendation made by the guardian ad litem. He found an estate in fee title would be of greater value than a beneficial interest in a trust. He specifically determined that the best interests of the surviving spouse would require renouncing the provisions of the will and taking the estate in fee with full incidence of ownership, notwithstanding that title would vest in her guardian who would have fiduciary limitations on its disposal.
The incompetent, as the second wife of deceased, would receive one-fourth of the estate if she takes under
• • While this is a cáse of first impression in Nebraska, the question has arisen in many other jurisdictions. There is an exhaustive annotation on the subject at page 10 of 3 A. L. R. 3d. As this annotation will illustrate, there is an irrеconcilable conflict in the decisions. This 'conflict arises because of várious theories used by the courts in interpreting and defining the meaning of the words “best interests” or similar words which are found in the several statutes under consideration.
Section 30-108(2), R. R. S. 1943, provides as follows: “In the event such surviving husband or wife shall be, at the time of the issuance of letters testamentary, insane or otherwise mentally incompetent to make such election, or shall become insane or mentally incompetent after the time of the issuance of said letters and prior to the expiration of the time limited in subsection (1) of this section for the making of an election, the county court in which the estate of the deceased is being probated shall, by order entered upon the reсords of said court, either upon its own initiative or upon the petition or application of any person interested in the estate of the deceased, appoint a guardian ad litem whose duty it- shall be to make such investigation as shall be necessary and thereupon forthwith report to the court his recommendátion as :to whether the court should elect on behаlf of any such husband or wife to take the provision made for him of her under the will of the deceased, or to take by inheritance and descent and distribution as provided by law. Upon the filing of such report the court shall appoint a time and place of hearing thereon of which notice shall be given to all persons interested in the estate of the deceased as is rеquired to be given
In the so-called minority view, all the decisions in one way or another indicate that the best interests of the incompetent will be served by electing the method which is the most valuable to the surviving spouse. This usually means the one having the greater pecuniary value is the one selected.
The language of the various statutes may differ but essentially most of them will provide that the election should be made which is to the best interests, advantage, welfare, or the like of the incompetent person. Our statute provides that .the court should make such election as it deems the best interests of the surviving wife or husband shall require. This seems to narrow the range of consideration.
The majority view, as stated in Kinnett v. Hood (1962),
The majority rule emphasizes other considerations than monetary. It characterizes the minority cases as placing the election purely on monetary standards or what would result in the larger pecuniary value, to the detri
In Nebraska we must start with the premise that the testator is presumed to know the law and that his surviving spouse may lawfully exercise her right to take against his will irrespective of his estate plan. In re Estate of Hunter (1935), 129 Neb, 529,
Many of the majority view cases criticize the minority cases, suggesting that they tend to sаnction: (1) The interests of the heirs of the incompetent as a consideration; and (2) give too much weight to what the surviving spouse would have done had she made her own election as a consideration. We are in full accord with the view that the interests of possible heirs of the incompetent should play no part in the decision. We would not, however, entirely ignore what the surviving spouse might have done had she made her own election.
It seems a little inconsistent under our law to say, as do some of the majority cases, that the election by the court to renounce the will should be made only if necessary to provide for the widow’s needs. This would write a restriction into our statute. The statute requires the court to make the election which it deems is in the best interests of the incompetent spouse. This must be made without reference to whether she may be provided for otherwise. We observe that neither section 30-107 nor section 30-108, R. R. S. 1943, which crеate the right of election and provide the necessary procedural steps, make any mention of or suggest any restrictions under which an election might be made. While a competent surviving spouse may elect to take against the will, even if it would seem obviously against her best interests to do so, a court in making the choice for an incompetent does not have that privilege. It must consider only the best interests of the incompetent.
On the record we find no considerations other than the monetary value of the estate. We find that an estate in fee is of much greater value than a beneficial interest in a trust. We agree with the District Judge that the best interests of the surviving spouse require taking the estate in fee with full incidents of ownership notwithstanding the title would vest in her guardian who would have fiduciary limitations on its disposal.
Affirmed.
Dissenting Opinion
dissenting.
The testator’s will here left to his wife, if she survived him, the exact amount and the specific share of his estate which she would receive if he had no will, but he left it in trust for her proper support and maintenance. The corporate trustee had the power to use all the income and all the principal for those purposes. The wife was given a full power of appointment of all remaining property on her death. At the time he executed the will his wife was incompetent and had been incompetent for some 4 years.
The majority opinion here determines that the best interests of the surviving spouse are better served by renouncing the will because “a fee title is of much greater valuе than a beneficial interest in the trust.” That might well be so if the surviving spouse were competent, but she is not.
While technically an incompetent might be said to have a fee title, in literal practical fact an incompetent during his or her lifetime has no greater beneficial interest in property managed on his or her behalf by a guardian than in property managed by a trustee under the powers granted by the will here.
If there was any reasonable prospect that an incompetent might recover, the básis for the majority opinion might be at least arguably supportable. In this case, however, the evidence is simply undisputed that the surviving spouse is now and always will be incompetent. The entire foundation for the majority opinion here must, and does, therefore, rest on the wholly unsupported conclusion that $343,000 held and used for the maintenance and support of the incompetent surviving spouse during her lifetime has a greater value in the hands of a guardian than it does in the hands of a trustee under the will.
The majority opinion accepts the universal rule that
The majority opiniоn here is not only too restrictive as applied in this case, but the impact of the holding upon other cases not presently before us has been largely ignored. It should be noted first that the trust provisions of the will here were obviously drawn to permit the share of the surviving spouse to qualify for the marital deduction under the federal estate tax laws. It must be noted too that thousands of Nebraska citizens have drawn wills which contain similar trust provisions which fully qualify for marital deduction treatment under federal laws. Because of the impact of estate and inheritance taxes, many husbands and wives have drawn and prepared separate wills to fit their joint estate tax plans. The majority opinion, if followed in the future, will now mean that the county court will be required to renounсe a will on behalf of an incompetent surviving spouse whenever the will leaves the share of the surviving spouse in trust under marital deduction provisions similar to those here, even though the amount received by the incompetent’s guardian will be identically the same.
The rule adopted by the majority of courts offers a much broader and sounder basis for making the appropriate election on behalf of an incompetent surviving spouse. It likewise permits an equitable approach on an individual case basis. The majority rule and the distinctions between it and the minority rule are well set out in the leading case оf Kinnett v. Hood,
“We believe that the minority view is too restrictive. By placing the election purely upon monetary consideration, too much emphasis is placed upon thе best interest of incompetents’ estates (and their heirs after death), with a possible detriment to the personal welfare, comfort and best interest of the incompetent. * * * The majority view that all of the surrounding facts and circumstances should be taken into consideration by a court in order to make the election to take under a will or against it seems to be the more equitable.”
Section 30-108(2), R. R. S. 1943, specifically places the responsibility for making the election for an incompetent spouse upon the county court. In this case that court made specific findings of fact, none of which are challenged. The county court then exercised the election to take under the will. The county court properly and correctly found the facts and exercised its judicial discretion under section 30-108(2), R R. S. 1943, and its judgment should be affirmed.